Archives for February 4, 2019

According to a Tweet by the founder of EthHub and the presenter of the Into the Ether podcast, Eric Conner, the rate of issuance of new Ether (ETH) is currently at its lowest ever. Owing to simple economics, this decreased supply could mean higher prices for the number three digital asset by market capitalisation.However, issuance is just one half of the story. For prices to move upwards, demand needs to remain at a constant rate or increase.Will Ethereum Network Upgrades Provide Increased Demand for the Asset?With new coin issuance rates at the lowest they have ever been on the Ethereum network, any surge in demand could see the price of the ETH shoot up much more rapidly than previously seen.The drop in the rate of issuance was pointed out by Ethereum proponent Eric Conner earlier today via Twitter. The podcast presenter and educational resource provider posted a chart taken from blockchain data firm Coinmetrics:Ethereum’s issuance rate is currently the lowest it’s ever been.@coinmetricspic.twitter.com/Qf8EWXML9a— Eric Conner (@econoar) February 4, 2019Of course, a drop in the issuance rate of an asset does not automatically mean prices will go up. For this to happen, demand for ETH would need to stay constant or increase. Given that Ether was particularly badly hit by the current crypto bear market, this is anything but a given right now.That said, the proposed upgrade to the network known as Constantinople could well drive demand, which would in turn lead to higher ETH prices. The scheduled update was due to occur last month. However, it was decided that the upgrade would be postponed until late February. Security issues were cited as the reasoning for this delay.Will a successful Constantinople hard fork make ETH prices rise?Constantinople is expected to pave the way for the much-anticipated Casper update. This improvement will switch Ethereum from a proof-of-work model to proof-of-stake. It will also focus on scaling the blockchain so that the applications currently being developed atop the network can be used by much larger numbers of people without crashing the network in the same way that the early decentralised application CryptoKitties did back in 2017.If the Ethereum network can successfully scale and a developer manages to create a must-have decentralised application on the network, the demand for Ether should also increase since the coins are used to power the applications and smart contracts hosted on the blockchain. If the rate of issuance stays at the levels shown today by Eric Conner, the price of a single ETH should increase much more rapidly than during the previous bull market.Who knows, it may even reach the now-ridiculous-looking 2018 price prediction of Reddit co-founder Alexis Ohanian. The tech entrepreneur famously stated that he believed the price of ETH would surpass $15,000 by the end of last year.Related Reading:Ethereum Constantinople Hard Fork Scheduled for Late February Following Recent DelayFeatured Images from Shutterstock.

The 10-year Treasury note yield of the United States has continuously dropped in a three-month span since November of last year for the first time since 2015, which may be seen as an indicator of uncertainty in the U.S. stock market.

Since late 2018, bonds and stocks have shown a similar trend of growth, which typically occurs when inflation and the Federal Reserve rate rise.

The decline in the 10-year Treasury note yield and other types of government debt suggests that investors may be losing confidence in the U.S. stock market despite the strong performance of the Dow Jones.

Source: CNBC.com

Stock Market to Face High Volatility

Speaking to The Wall Street Journal, Raymond James fixed income capital markets head Kevin Giddis said that while a recession is unlikely to hit the U.S. market anytime soon, the trend of the stock market could easily reverse.

The executive stated that there exists a clear discrepancy between the outlook on the U.S. economy by investors in the stock market and the bond market.

There is obviously a separation between where the equity market sees the world and where the bond market sees the world. We don’t know what’ll cause the next recession, but at the same time, you flip it to the other side and you don’t see much that’ll stimulate economic growth.”

[embedded content]

Encouraged by the patience of the Federal Reserve on maintaining its rate, progress in the U.S.-China trade talks, and the performance of key industries like the oil sector, the U.S. stock market has shown a high level of momentum in the past two months.

But, analysts remain uncertain on whether U.S. markets are initiating a proper mid-term rally or simply showing an extended corrective rally from its crash in late 2018.

Last month, major Canadian investment firm Gluskin Sheff chief economist David Rosenberg firmly stated that the rally of U.S. markets was triggered by technical factors over fundamental ones.

Rosenberg suggested that a global recession could occur in the years to come as most major markets including the U.S., China, and Japan show weakness.

One reason to view the renewed risk-on rally as a technical bounce rather than fundamental is because we’re staring at a global recession. It’s not just me – the crew at Consensus Economics (seemingly out of consensus) sees sub-3% world GDP growth for the first time since ’09.

Art Hogan, a National Holding chief market strategist, similarly stated that until the U.S.-China trade talks come to a conclusion and a comprehensive trade deal is achieved, the U.S. market will not be able to make more progress from its current level.

“To make further gains from here, we have to get concrete evidence coming out of talks with China that look like we’re actually making progress, and get signs of consistent growth,” said Hogan.

As CCN reported on Monday, the anticipation and the confidence toward a trade deal by March 1 are increasing. If a trade deal is accomplished, it could send the U.S. stock market into a major rally.

However, if both parties fail to come to an agreement and additional tariffs are imposed, the market may face significant shockwaves.

China Trade Deal Has to Happen at This Point

[embedded content]

Wall Street analysts have projected corporate earnings to decline by 0.8 percent in the first quarter of 2019, a complete change in sentiment since December when analysts expected a 3.3 percent growth.

At this point, the failure to come to a consensus on a deal to ease the pressure on both China and the U.S. could reverse the trend of the U.S. market overnight.

Several analysts have said that the U.S. market may have reached its short-term peak and without major catalysts, an additional climb from the current level remains unlikely.

“(There’s) a lot of geopolitical risk between the U.S. and China — certainly we are in a worse place than we were a year ago,” Standard Life Aberdeen co-CEO Martin Gilbert said last month, expressing concerns in regard to the extent in which geopolitical risks are affecting major markets.

After experiencing increased levels of volatility last week, Bitcoin (BTC) endured the weekend without any major price moves and has so far experienced a relatively involatile Monday. Recently, Bitcoin entered its longest-ever bear market, and investors and analysts alike are keen on speculating on when it will finally reach a price point with enough buying pressure to reverse its current trend.According to one prominent cryptocurrency analyst, Bitcoin is now nearing its seventh major triangle formation since its crash first began in late-2017, which means it could shortly see increased levels of volatility.Bitcoin (BTC) Enters Longest-Ever Bear MarketAt the time of writing, Bitcoin (BTC) is trading down marginally at its current price of $3,460. Over the past week, BTC has established $3,400 as a level of support, but it has failed to break above $3,500, making this price its nearest resistance level.In a recent email from Mati Greenspan, the senior market analyst at eToro, he noted that Bitcoin is now in its longest-ever bear market, but it has not yet fallen enough for the recent crash to be the largest – by percentage – that Bitcoin has seen in its relatively short history.“From December 2017 until today bitcoin has dropped a total of 82% from peak to trough, making a total stretch of 413 days without any indication of a turnaround. It should be noted though that even though this is the longest stretch, it’s not the deepest. The five-month bear of 2011 saw a drawdown of 93% and the crypto winter from the end of 2013 to the beginning of 2015 saw a total drawdown of 86%,” he explained.Furthemore, Greenspan also noted that Bitcoin has established six different wedges since it touched nearly-$20,000, four of which have broken to the downside. He further explained that Bitcoin is nearing the end of its seventh wedge, which could mean further downside is in store for the embattled cryptocurrency.“With $5,500 (blue line) as the base, we’ve seen six different wedges, four of which have broken to the downside. Now that the blue line is broken, we’ve moved the support level to $3,000 and we can see that we’re now coming to the seventh wedge,” he explained while referencing the below chart.Analysts Expect Increasing BTC Volatility in Near-FutureIf the triangle pattern that Greenspan highlighted does continue to repeat itself, BTC will likely see increased levels of volatility in the near-future.Analysts concur that Bitcoin will soon see increased volatility.Josh Rager, a popular cryptocurrency analyst on Twitter, offered his followers a cautiously bearish assessment of BTC’s current price action, noting that the current lack of volume and possible bear flag formation could mean a drop is going to occur at some point this week.“$BTC Still consolidating in a channel – possible bear flag for a continuation down Volume isn’t great – hoping to see some volatility this week,” Rager explained.$BTCStill consolidating in a channel – possible bear flag for a continuation downVolume isn’t great – hoping to see some volatility this week pic.twitter.com/GZKLdfsV91— Josh Rager 📈 (@Josh_Rager) February 4, 2019Assuming that Bitcoin’s trading volume increases over the coming week, traders will likely get a better idea of whether or not Bitcoin is going to revisit its yearly-lows around $3,200 or climb higher to recover some of its recent losses.Featured images from Shutterstock.

Social media giant Facebook is growing its blockchain efforts by hiring staffers from Chainspace, the startup behind a smart contracts platform.

The news of the hires – first reported by Cheddar – demonstrates that the social media company is moving ahead with its blockchain ambitions, which were first revealed last May with the announcement of a new, dedicated blockchain unit.

The researchers behind Chainspace may be well suited to help Facebook scale blockchain across a range of applications. According to its website, Chainspace uses sharding – the process of breaking a database into smaller units – to alleviate the scaling problems faced by blockchain networks.

Four out of the five researchers behind the academic paper on which Chainspace is based will be joining Facebook, according to Cheddar. A Facebook spokesperson confirmed to CoinDesk that the startup itself or its technology weren’t acquired, but that some of its staffers had joined Facebook’s internal blockchain group.

“Like many other companies, Facebook is exploring ways to leverage the power of blockchain technology,” Facebook said in a statement. “This new small team is exploring many different applications. We don’t have anything further to share.”

The social media giant is currently hiring for 11 blockchain roles, according to Facebook’s careers site. That’s up from five last December. According to job-description boilerplate, Facebook’s blockchain team operates as “a startup within Facebook,” adding:

“Our ultimate goal is to help billions of people with access to things they don’t have now – that could be things like healthcare, equitable financial services, or new ways to save or share information.”

The Chainspace website currently lists 11 staffers and four advisors on its team page. Currently sitting atop the site’s homepage is a message teasing Monday’s news: “We’re excited to announce that the team is moving on to something news.”

While financial forecasters are predicting a bullish 2019 for the bitcoin price, the cryptocurrency first needs to fight strong technical barriers in the near-term.

It is becoming difficult for bitcoin bulls to initiate a substantial push towards the $3,480-barrier and beyond. At the same time, their presence at the support area above $3,371 is stopping the price from further downside action. The situation has led bitcoin to remain rangebound, which is increasing the bearish sentiment in the near-term scenario.

On the intraday/weekly level, bitcoin could now pursue another selling action thanks to two pressing issues: lower volatility and volume. Let’s discuss them in the sections as follows.

Bitcoin Price Sees January Deja Vu

Bitcoin is somewhat imitating the price action between January 26 and January 27. Back then, it was trending inside a triangle formation. As the pattern extended and trading range started contracting, the volume also began to diminish. In parallel, the gap between the upper and the lower Bollinger Band, which is directly proportional to an asset’s volatility, also started to minimize. On January 28, the bitcoin price broke down from the triangle pattern.

BITCOIN (BTC/USD) 1H CHART | SOURCE: COINBASE, TRADINGVIEW.COM

In the current trading range, the bitcoin chart is expressing a similar trend sentiment. The price is trending inside a new triangle pattern while the Bollinger Bands’ gap and hourly volume are declining. Bitcoin, like the previous time, has broken above the channel support to form a higher high towards the resistance of a medium-term falling wedge pattern (indicated via a dotted descending trendline). And it has come back inside the triangle channel – just like in the case of the first triangle.

If the scenario is to be believed, bitcoin price could retest the channel resistance, only to follow a pullback action towards the channel support. After that, the price could keep consolidating inside the channel or attempt a breakdown towards the falling wedge support.

Falling Wedge

Technically, a falling wedge pattern is a bullish indicator. It begins broadly at the top but squeezes as the asset moves lower while forming reaction highs and reactions lows that eventually converge. Upon closing in towards the cone’s apex, the asset undergoes a resistance breakout to find a new support area.

BITCOIN (BTC/USD) 1D CHART | SOURCE: COINBASE, TRADINGVIEW.COM

The bitcoin price is similarly closing in on its falling wedge’s apex. It should break out to the upside in ideal circumstances, but given the moody nature of the market, a breakdown is also possible. The latter would likely push the price back towards $3,100, the market’s previous bottom level.

Intraday Strategy

Keeping trades inside the triangle channel looks ideal at this point in time. That said, entering a long position towards resistance on a pullback from support would yield small profits. At the same time, maintaining a stop loss order 1-pip below the swing low would minimize losses in case the trend reverses.

Similarly, a reverse from resistance would open a decent short opportunity towards support, providing a stop loss 1-pip above the local swing high is placed to maintain the overall risks.

According to a post from the official MyEtherWallet’s Twitter account, reports suggest that users of the popular Ethereum network interface have been targeted by a phishing email. The fraudulent correspondence requests users give up personal information that could put their crypto holdings at risk of theft.The email details a supposed security breach that occurred during January 2019. Affected users are requested to sign in to their wallets using their private key or seed phrase and in doing so are handing over this highly sensitive information to the attackers.MyEtherWallet Users Urged to Stay Vigilant Over SecurityIn a Tweet from earlier today, the team behind the MyEtherWallet (MEW) Ethereum blockchain interfacing program alerted users to a phishing email that attempts to trick people into disclosing their private keys. The Tweet contains a screen shot of the email itself.It states that MyEtherWallet fell victim to a DNS attack during January of this year. According to the fraudulent email, only MEW users accessing their wallets using either their private key or seed phrase were impacted by the attack.Those users affected are requested to visit the website and download their Keystore file. They are then encouraged to reply to the email requesting further guidance on securing their wallets. The fraudulent correspondence concludes with the stark warning:“If you do not update and secure your wallet, you are running the risk of losing your funds stored on your wallet.”Attention #MEWfam,There’s another phishy email going around asking users to give up personal information. Don’t believe the hype!#1. We will never email you first (only reply to support).#2. We will never ask for your private key (or other sensitive info).#3. Be skeptical! pic.twitter.com/654TLIt5ar— MyEtherWallet.com (@myetherwallet) February 4, 2019In the Tweet alerting users to the scam, MyEtherWallet offered advice to help people to avoid falling victim to phishing attacks when using the Ethereum blockchain interface. Users were reminded that MyEtherWallet will never email first – only in response to support requests – and they never ask for private keys or seed phrases. Finally, users are advised to always exercise caution when faced with requests for such sensitive information.One Twitter user responded to the announcement, commenting on the underhand tactics used by those behind the phishing email scam:Jesus that’s dirty.— Arseniy ✌️ Ivanov (@freeatnet) February 4, 2019The scam draws on previous MyEtherWallet security compromises to give it an air of legitimacy. A similar DNS attack to that detailed in the email occurred last year against the blockchain interface program. Many of those unlucky enough to fall victim to the security issue last April found that the Ether and other tokens stored using the MEW service were stolen by those behind the attack.This is the second such phishing attack against a popular cryptocurrency service provider already this year. In the previous example, users of the peer-to-peer Bitcoin trading website LocalBitcoins were directed to a phishing website from the official forum where their login credentials were stolen. This caused the service to temporarily disable its compromised forum. However, many users had their wallets emptied before action could be taken. The precise figure of stolen funds is unknown but it is believed to be in excess of $28,000.Related Reading:ShapeShift Phishing Site Advertisement Tops Google Search ResultsFeatured Image from Shutterstock.

Facebook’s secretive crypto division has reportedly made its first acquisition, quietly purchasing a blockchain startup that specializes in smart contract development.

Citing unnamed sources, financial news outlet Cheddar reports that Facebook acquired Chainspace, a blockchain firm founded by University College London researchers.

The Chainspace website describes its project as “a planetary scale smart contracts platform” that uses a “distributed web of blockchains for scalability, speed and privacy.”

A banner at the top of the website reads:

“We’re excited to announce that the team is moving on to something new. Chainspace code and documentation will still be open source, and all previously published academic work remains available.”

Quoted in the report, a Facebook spokesperson confirmed that former Chainspace employees are working in its blockchain division but was mum on pretty much everything else:

“Like many other companies, Facebook is exploring ways to leverage the power of blockchain technology. This new small team is exploring many different applications. We don’t have anything further to share.”

According to Cheddar, the purchase was an “acqui-hire,” suggesting that Facebook was more interested in Chainspace’s research team than its technology, and the company spokesperson reportedly denied that it had acquired Chainspace tech.

As CCN reported, Facebook has been working on a blockchain and/or cryptocurrency project for some time now. The company has been tight-lipped about what form this project will take, but sources have said that it will likely take the form of a fiat-backed “stablecoin” integrated into chat platform WhatsApp.

The social media giant has “aggressively” hired blockchain developers and currently has around 40 employees working on its crypto project.

Earlier, Facebook CEO Mark Zuckerberg committed to making researching cryptocurrency one of his personal challenges for 2018.

Elon Musk posted four tweets last night demonstrating the new Raptor rocket engine. SpaceX engineers have been hard at work finalizing the next-generation rocket technology that will eventually power trips for the exploration of Mars.

Musk Tweets Proof of Rocketry

While most of America was focused on the Super Bowl, Musk was in Texas at the SpaceX testing site. The rockets had recently been shipped from California to the testing site near McGregor, Texas. Musk and his team were up late preparing for the first test late Sunday night. A few hours later, the first video went live on Twitter.

Intended to be reusable, the engines use cryogenic liquid methane and liquid oxygen. Previous SpaceX rockets used RP-1 Kerosene and liquid oxygen. Developing the rockets in-house was part of Musk’s business plan from the start, according to an early SpaceX investor.

When the rockets were first shipped from California to Texas, Musk noted that the company is working hard to get a moon-worthy rocket to ready. The ultimate goal of the Raptor rockets is still for Mars exploration. The Raptor is intended to replace existing rockets already in production, the Falcon 9, Falcon Heavy, and Dragon.

The Raptor product is currently on track. Musk has previously tweeted that the company will attempt a moon trip first.

SpaceX: Mars Exploration is the Goal

While SpaceX keeps its eyes on human exploration of Mars, heavily developing the Raptor, it is under financial pressure to actually develop revenues. The company is good at winning open contracts from governments and large companies around the world, but recently suffered a spate of layoffs. Musk blamed these layoffs on the “absolutely insane” Starlink global high-speed internet project as well as a co-existing Mars rocket project.

Musk says the company needs to be “spartan” in its expenditures. The revamped approach to Raptor appears to be an attempt to cut costs by developing the rocket in stages. First it will go to the Moon and potentially function as an orbiting product around Earth. Later it will be further developed and upgraded into a rocket with the potential to explore Mars.

While Musk believes that layoffs at his day job — electric carmaker Tesla — were necessary in order to keep the company’s products relatively affordable, he thinks the SpaceX research projects are costing too much and seems to regret the SpaceX layoffs. He reportedly said during an investor call last week:

“And so, SpaceX has to be incredibly spartan with expenditures until those programs reach fruition.”

When Musk says “insane,” he doesn’t necessarily mean it in a negative way. As a businessman, he’s referring to the fact that his company is engaged in services once only provided by governments with virtually unlimited resources. When SpaceX eventually develops a space highway to Mars for mankind, they will either be the only company doing it or the only one doing it well. Untold fortunes await SpaceX at that point.

While SpaceX could focus on more terrestrial projects like competitive satellites, which they are also into, the company’s true mission is deep space exploration. The potential for profit from space exploration is an unknown quantity, but it could easily go into the trillions. As profit goes, one potential area of investment would be minerals acquisition. The quantities of gold, platinum, and other rare materials in space by definition outsize supplies on earth. Developing a profitable method of extraction from foreign planets and space rocks is but one way that SpaceX could, in the long run, become the most profitable company in history.

Tesla Opens A Chaotic Trading Day After SpaceX Tweets

As for Tesla, trading early this morning showed a big sell-off. Buy orders kicked in and kicked it up momentarily. After an hour or so of trading, things were on a recovery path.

While SpaceX is a separate company from Tesla, its fate is very much tied to Tesla. Good news about SpaceX can reflect well on Tesla, and vice versa.

Certainly the weekend’s activities demonstrate one thing about Musk: he is fully grounded. He understands that SpaceX needs to get realistic in its endeavors, and completion of rockets for near-term use (and potential sale to governments and others) is one of many ways they can do so. As for SpaceX engineers, this was likely not the first or last time they’ll be putting in long weekend hours in pursuit of a noble dream.

For the first time since 2016, U.S. corporate earnings are projected to drop by 0.8 percent per share in the first quarter of 2019. But, the projection had no visible impact on the Dow Jones and the rest of the U.S. stock market.

In December 2018, Wall Street analysts forecasted U.S. corporate earnings to grow by 3.3 percent. The data provided by FactSet obtained by FT show that analysts have slashed their forecast from 3.3 percent growth to a 0.8 percent decline.

The drop in U.S. corporate earnings comes in a period in which large conglomerates, especially in the tech sector like Apple and Samsung, are struggling to deal with weakening revenues.

Why the Dow Jones Remains Unaffected

Since Monday’s opening bell, the Dow Jones has increased by 0.4 percent and was unaffected by the projection.

Max Gokhman, head of asset allocation at Pacific Life Fund Advisors, told FT that margin deterioration is likely going to remain a theme for 2019 as corporations face uncertainties related to the U.S.-China trade war.

“Margin deterioration is going to be a big theme this year. What is driving that deterioration is higher labour costs and the friction created by the trade war, which disrupts supply chains,” he said.

Most major conglomerates with poor earnings reports have attributed their lackluster performance to intensifying geopolitical risks.

[embedded content]

Last week, as CCN reported, Samsung recorded a 31 percent decline in net profits as various areas of the firm including its mobile phone and semiconductor businesses faced hardship.

A growing number of conglomerates are revising their earnings to the downside. Yet, the Dow Jones has not shown signs of slowing down from its recent recovery.

It is likely that the confidence in the U.S.-China trade talks and the prospect of a deal by March 1 by the majority of investors in the U.S. stock market has soared.

If the geopolitical risks surrounding the U.S. and China have been the driving factor of the weakening global economy, the establishment of a comprehensive trade deal would eliminate the risks.

An amicable end to the U.S.-China trade war could ensure a sustained stock market recovery. | Source: Shutterstock

The growing anticipation towards the U.S.-China trade talks, the Federal Reserve’s patience in maintaining its rate at 2.25 percent to 2.5 percent, and the strong performance of key sectors like the oil industry have contributed to the recovery of the Dow Jones.

Nicholas Colas, the co-founder of DataTrek, said that investors are expecting the struggles of major conglomerates are temporary and that the market is expected to recover in the second quarter.

The only way companies could recover in a similar time frame in the second quarter of 2019 would be if a trade deal is achieved, which many investors believe will happen.

“The market is trading on the hope that this is a temporary issue and that we start to see some growth in the second quarter and that the back half of the year should be a whole lot better,” Colas said.

Oil Industry Lifted Tremendous Pressure From Dow Jones

Even up until December 2018, oil companies were expected to end the year with a poor quarter as oil prices declined.

[embedded content]

But, reports revealed that Exxon and Chevron, the two oil giants, recorded a combined profit of $84 billion, surpassing the expectations of analysts with ease.

“These companies have figured out how to operate in this new environment, and they have adjusted well. The key going forward will be maintaining discipline. This is now a low-growth industry, so you’ve got to invest well,” Edward Jones analyst Brian Youngberg said.

The unexpectedly strong performance of the oil industry combined with the solid earnings released by leading car makers in the likes of Ford have eased the pressure on the Dow Jones and the rest of the U.S. stock market.

When I decided, maybe against my better judgement, to live on bitcoin for a week, the plan was met by a combination of cautions and jokes from friends and loved ones: “Just don’t starve,” “Well, it’s the New Year, a perfect time to start a new diet,” “Will you be able to eat?”, “Have you really thought about it?”

I had “really” thought about it and it seemed not only sensible but necessary. Nakamoto’s white paper calls Bitcoin an “Electronic Cash System,” and I hadn’t stressed the cryptocurrency’s utility as an actual method of payment.

My experiment would likely validate the strong opinions of skeptics (to whom bitcoin is either some nebulous scam at its worst or an outrageously valued trinket for prodigal hobbyists at its best) and that camp of maximalists who believe that bitcoin isn’t and never was digital cash.

It’s a problem that Kashmir Hill ran into when she did her own experiments, more so in 2013 than 2014. In 2013, her final conclusion was that she had “survived” the week, but by 2014, she had herself a ball spending bitcoin. She went from conquering San Francisco’s hilly landscape on foot and bike in 2013 (and the occasional, simple pleasure of pizza and cupcakes) to the luxury of Uber rides, wine tours and even a strip club visit just a year later.

She did well for herself the second go at it. I want to be able to do even better.

That as my mindset going into my own version of the experiment, picking up five years later from where Hill had left off. If she survived on her first attempt, then I damn well ought to be able to thrive, I thought, going into it.

Boy, was I dead wrong.

A day or two in was all it would take to break this expectation as I soon learned that my experience would be unlike either of Hill’s. I anticipated great merchant adoption and with it a greater variety of services through which to use my bitcoin. I thought I was walking into a more vibrant Bitcoin scene than half a decade ago, an opportunity rich with ways I could offload my coin.

Instead, I found (at least in San Francisco) that fewer merchants take bitcoin now than they did before and that the Bay area’s Bitcoin community, excepting those still active in it, had receded into altcoin enthusiasm and the flowering industry of “blockchain not Bitcoin” that had become the new darling of tech VCs and entrepreneurs.

Those still involved in the community took care of me though, and the week was just as easy or as difficult as I wanted to make it.

I finally wrap up my week of living on bitcoin in San Francisco with visits to 20 Mission and bitcoin artist cryptograffiti. But first, I’ll have to survive a storm out on the Bay.

Saying that I thrived while on bitcoin would be pushing it, but saying that I survived would be an embellishment.

So I’ll put it another way: I subsisted. Plain and simple, I got by without buying into a strip club’s tit-for-tat (tit-for-bit?) or splurging on a high-dollar meal like Kashmir Hill did in 2014 (though I could do that here in Nashville, dropping fat sats for a meal at Flyte). Sure, the drinks at Stookey’s weren’t cheap, but they weren’t a bottle of Dom either. I got by without even buying a meal from a merchant during my trip, relying on bitcoin-bought Uber Eats credit and friends to keep me fed.

My experience was both anticlimactic and blindsiding. I could have done it anywhere, something that I describe in the write-ups as fascinating and frustrating at the same time. I didn’t need San Francisco to spend my bitcoin (a city that, the week made quite clear, didn’t really want my bitcoin). Bitcoin didn’t need the merchants, though, to be useful; infrastructure, like Paxful and Bitrefill, made it useful.

As the series unfolded on social media, plenty of other bitcoin-to-gift-card services, like Fold App and Bidali, reached out to me on Twitter, reaching for a chance at a PR plug (don’t get me wrong, though — I respect the hustle). I used what I knew going into the experiment, though out of the three exchanges that I demoed (Paxful, Bitrefill and Gyft), I stuck with Bitrefill for its convenience and efficiency.

I probably should have tried some of the other options, and I fully support any company building this infrastructure because, without it, the experiment would have been over by day two (or I would have had to swallow the probability of a seven-day fast as I wrestled with how much I cared about my journalistic integrity).

So I learned that this experiment is either too easy or too impossible, depending on how you frame it. What else I learned (in a strictly Silicon Valley context):

The general public’s enthusiasm for Bitcoin has been dampened with the market.

Interest in altcoins and blockchain has, in part, replaced this enthusiasm.

Because of this interest, there’s at least one place (The Boba Tea Shop) that accepts a motley of altcoins but not bitcoin.

Fewer places accept bitcoin now than in 2013–2014.

Places stopped accepting bitcoin either because their payment processors went under or because transaction times and fees were outrageous during the peak of the 2017 bull run.

Transaction times were pretty quick and fees weren’t high (none of my transactions took over a minute the whole week unless I opted for a low fee).

Even if merchant adoption has waned, infrastructure using bitcoin to leverage services (e.g., Bitrefill, Paxful, etc. for buying gift cards) has progressed.

Bitcoin ATMs aren’t as cool as they sound.

Merchants who don’t accept bitcoin will either be annoyed/amused/confused when you ask if they do.

An unfortunate number of places that used to accept bitcoin don’t exist anymore.

You still can’t buy coffee with bitcoin (unless you buy a gift card first).

You don’t need a payment processor to do a point of sale and I wish businesses would understand this.

Bitcoin OGs are still around.

If you decide to live on bitcoin for a week, they will help you out.

You could get hammered on bitcoin in San Francisco with liquor-by-the-drink (or bottle).

Bitcoin is (obviously) best as a store of value.

Because of this, it has its faults as a payment method, but the community is aware of these faults.

Coinbase has become a monolithic entity that is hard to penetrate.

This experiment is not all-encompassing and would play out much differently elsewhere.

That last point might be a bit foolhardy to make before I actually try it, but I was told on day one by a Czech booth exhibitor that Prague would be a breeze. Aaron van Wirdum corroborated this claim, adding that his home in the Netherlands (specifically Amsterdam and Rotterdam) would be a great testing ground for the experiment. Jared Harrell, a community manager at Quantstamp and Canadian native, told me Vancouver would be worth visiting while pouring praise on the Canadian bitcoin community’s constitution and significance (my editor, another proud bitcoin Canuck, has also implored me to have a go at it in Canada).

I’ll get there eventually (I hope). I intend to replicate this science experiment to get a larger sample size, and I have a hunch that I’ll get different results in different jurisdictions. For now, New York, Canada (Quebec/Ontario), Czech Republic (Prague), Netherlands (Rotterdam/Amsterdam) and the U.K. (London) are on my list of test subjects, and, for the new experiments, I’ll attempt a heightened level of difficulty for the variables (including not using Bitrefill, Paxful, Gyft, etc.).

Latin America is another place that comes to mind, probably the place that best exemplifies why this experiment is worthwhile. As the economic and political situations in Venezuela worsen, bitcoin’s relevance in the region is on prominent display, and its utility is infecting neighboring countries as a diaspora of Venezuelan refugees pours across the economically battered country’s borders.

At the end of my experiment, I had the privileges of eschewing my bitcoin wallet in favor of my real one and I was elated to get to use cash (whether physical or digital) again. For those (and they’re out there) living unbanked or under the duress of a faltering monetary system, the experiment never ends — it’s a struggle they reckon with daily.

So I also learned that, over the course of the week, I didn’t need to live on bitcoin, so the choice to was gratuitous and a bit opportunistic (it gave me something fabulous to write about and has supplied my cocktail-party-conversation reserves with endless new material). But I also learned that, if I needed to, I could live on bitcoin, just as a growing population of underserviced and financially neglected citizens across the globe could right now.

Bitcoin is monetary sovereignty, and this experiment is being stress-tested every day.

You didn’t need me to show and tell you that but that also doesn’t mean I won’t do it again.

If you have tips or places you think Colin should visit, drop him a line on Twitter (@AsILayHodling) or email (colin@bitcoinmagazine.com).